tl;dr
Bitcoin may be heading for a major supply shock as exchange reserves hit the lowest point in years. CryptoQuant data reveals reserves are at their lowest level since 2022, while demand from long-term holders is surging despite price fluctuations. This potential supply shock could signal a bullish tr...
Bitcoin exchange reserves hit lowest level since 2022, signaling potential major supply shock
Institutional and corporate demand for Bitcoin spikes, exacerbating potential supply crisis
Around 2.5 million BTC held in exchange reserves, with 69% supply held by individuals
Bitcoin supply crisis imminent, potential for significant impact on market dynamics and price
Consideration of strategic Bitcoin reserves in US and other countries, further exacerbating potential supply shock
Bitcoin may be heading for a major supply shock as exchange reserves hit the lowest point in years. CryptoQuant data reveals reserves are at their lowest level since 2022, while demand from long-term holders is surging despite price fluctuations. This potential supply shock could signal a bullish trend in the coming months. Additionally, corporate and individual whales are acquiring Bitcoin at a rapid pace, with ETF issuers buying it 20 times faster than miners can produce it. The supply crisis is compounded by the fact that around 2.5 million BTC is currently held in exchange reserves—the lowest balance in nearly 3 years. Moreover, 69% of the supply is held by individuals, indicating a real supply crisis. The majority of Bitcoin has already been mined, with only 5.7% remaining, and a slight increase in demand could trigger a fresh bullish cycle. The market has also seen a spike in Permanent Holder Demand, with holders selling BTC less frequently, potentially creating a supply shock. Additionally, there is consideration of establishing a strategic Bitcoin reserve in the US and other countries, further impacting supply. However, macroeconomic factors such as interest rates and global tariffs will also play a critical role in Bitcoin's future.
Bitcoin may face a major supply shock as exchange reserves hit the lowest point in years. CryptoQuant data shows reserves at the lowest level since it began recording this data in 2022. Additionally, demand for Bitcoin is spiking from long-term holders despite price turmoils. This supply shock could become a major bullish signal for the coming months. IS BITCOIN HEADED FOR A SUPPLY SHOCK? Since Bitcoin has reached a new era of market integration and institutional acceptance, corporate and individual whales are acquiring as much as they can. Last month, ETF issuers were buying it 20x faster than miners could produce it, and they collectively hold more than Satoshi Nakamoto. However, due to these trends, Bitcoin’s supply is in jeopardy.
Bitcoin in Exchange Reserves at New Low. Source: CryptoQuant. As CryptoQuant data shows, around 2.5 million BTC is currently held in exchange reserves. This is the lowest reserve balance in nearly 3 years. Additionally, the US Bitcoin ETF issuers and other corporate whales are very flashy buyers, but 69% of the supply is held by individuals. In fact, ETFs recently had their first weekly outflow of 2025, showing that the problem goes beyond them. US Spot Bitcoin ETF Net Inflows. Source: SoSoValue. In other words, the supply crisis in Bitcoin is very real right now. Additionally, the vast majority of it has been mined already, with only 5.7% remaining. On top of that, unknown quantities are lost. A slight increase in demand could kick off a fresh, bullish cycle. This demand may be materializing despite Bitcoin’s recent price declines. This week, the market has witnessed a sharp spike in Permanent Holder Demand, signaling strong confidence from individual users. These holders are also selling BTC less frequently. These factors could combine to create a Bitcoin supply shock. “Soon every billionaire will buy a billion dollars of Bitcoin and the supply shock will be so great that we’ll stop measuring BTC in terms of fiat,” said Michael Saylor in a recent interview. There’s also the consideration of a Bitcoin reserve in the US and many other countries. In the US, 20 states have currently proposed bills to establish a strategic Bitcoin reserve. If such strategies are approved, state and national governments will purchase BTC, and the supply will further decline. So, at the current level, a Bitcoin supply chain is very much imminent. However, macroeconomic factors, such as interest rates and global tariffs, will also play a critical role. Best crypto platforms in Europe | February 2025 Wirex Wirex Explore YouHodler YouHodler Explore eToro Close modal etoro etoro Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more eToro Close modal etoro etoro Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes